Irish AIM-listed diamond explorer African Diamonds said an updated feasibility study for its AK6 diamond mine in Botswana had revealed its first phase of development will cost $120 million (€98 million).

This is a rise on previous estimates for capital expenditure, and is due to an increase in throughput levels, adverse foreign exchange movements and scope changes for the project. The study also increased the average diamond price from $194 to $243/ct.

The mine, which is a joint venture with Lucara, is due to begin production in the fourth quarter of 2011.